PBC Criticizes Termination of Transit Cargo Satellite Tracking

PBC Criticizes Termination of Transit Cargo Satellite Tracking

Karachi, January 9, 2025 – The Pakistan Business Council (PBC) has raised serious concerns regarding the Federal Board of Revenue’s (FBR) decision to terminate satellite tracking of transit cargo containers destined for Afghanistan. In a detailed letter addressed to the FBR chairman, the PBC highlighted the potential risks and adverse consequences of this policy change.

The PBC emphasized that relying on Customs resources to physically monitor cargo movement, coupled with the placement of tracking devices on prime mover trucks instead of containers, increases the risk of cargo diversion. The absence of container-specific tracking compromises the integrity of the transit trade, creating loopholes for misuse.

The misuse of transit trade arrangements, according to the PBC, has significant repercussions. It results in tax revenue losses, undermines local industries, and adversely affects employment opportunities. The PBC has consistently recommended measures to mitigate these risks. Among these suggestions is extending container tracking beyond the Pakistan-Afghanistan border and verifying that returning containers are empty. The council stressed that without container lock monitoring devices, there is no technical assurance that prime mover trucks will transport the intended cargo, as containers can be switched through collusion.

The PBC urged the FBR to inform stakeholders about the timeline for deploying the necessary technology to ensure that transit cargo leaves Pakistan and does not return. The council also sought clarity on interim measures, specifically how the proposed “People, Process, Technology” framework will be implemented to address potential losses in tax revenue and support the formal economy.

In its correspondence, the PBC reiterated its commitment to assisting the FBR in developing robust systems to safeguard Pakistan’s economic interests. It called for a transparent approach to managing transit trade and urged the authorities to ensure that the proposed measures are both effective and equitable.

The PBC’s concerns reflect the broader need for comprehensive solutions that balance facilitation of trade with strict enforcement mechanisms. The council’s proactive stance underscores the importance of stakeholder engagement in shaping policies that impact the country’s fiscal and industrial landscape. By addressing these issues promptly, the PBC believes Pakistan can safeguard its revenue streams and foster sustainable economic growth.